The principal objective of this project is to evaluate empirically the economic performance and demographic impacts of neighborhood health centers (NHCs). Specifically, we are estimating multivariate production and cost functions for the two basic types of ambulatory health care services provided by neighborhood health centers: medical care and dental care. We also are comparing health levels in areas (counties) that are similar except for the presence or absence of an NHC. The estimation of production functions will enable us to compare the observed input ratios of neighborhood health centers with the optimal or cost-minimizing ratios. The estimation of cost functions will allow us to address the issue of the extent of economics of scale and the potential for exploiting these economies. The comparison of mortality rates of matched counties will enable us to assess the impact of neighborhood health centers on health outcomes.